Buying property in a flood plain is risky business. In the next twenty years, whatever house or building you place on that property—or whatever house or building already exists on that property—may never be flooded, or it could be flooded dozens of times. However, you can protect your investment with flood insurance. Additionally, you will need flood elevation certificates for any flood plain property you buy. Here are some important questions you should be asking before you ever make an offer on this type of property.
Does the Seller Have a Current Flood Elevation Certificate on File?
Anyone that owns flood plain property is required to obtain a flood elevation certificate before acquiring flood insurance. These certificates have to be filed with local city and state agencies that are in charge of flood plain monitoring and supervision. It means that if the seller has one of these certificates, and it is current, it should be on file. Ask for it or ask to see a copy of it before you even make an offer on the property. If the owner does not have a current certificate on file, request that he/she acquire one before you make an offer on the property. It saves you the trouble of having to hire a surveyor to establish flood plain boundaries around your property and acquire the certificate yourself.
If You Are Buying Vacant Flood Property, Will the Contractor Secure the Flood Elevation Certificate?
When you are buying vacant property and plan to build either a house or a commercial building on said property, the construction contractor may be required to get the flood certificate for you. In some states, you cannot begin building on flood plain land until the contractor has secured the proper flood elevation documents. Ask your contractor what the policy is in your state, and then make sure that whatever the policy is, the flood elevation certificate and related documents are obtained.
Should You Ask Insurance Companies About Flood Elevation Documents and Insurance?
Before you purchase the property, you should also be talking to insurance companies. Ask them if they have had prior claims for damage on this particular parcel of property (if there is a structure on it), and what was paid out in claims, if anything. Ask for quotes on the property with proper flood elevation certification filed, too. It helps to know how much extra the property will cost you to insure the safety of any house or building you place on the property or the existing structures.